Is Ltcg tax applicable on ELSS?

Is ELSS exempt from Ltcg?

The Long-Term Capital Gains on ELSS are tax-exempt up to Rs 1 lakh, and dividend received is tax-free in the hands of investors. You can continue to invest in this scheme even after the completion of the lock-in period of three years.

How is Ltcg calculated on ELSS?

So this investor investing an amount of Rs 1.5 lakhs in ELSS will now have to pay a tax on the gains above Rs 1 lakh. His total gain is Rs 1.5 lakhs, out of which, after removing Rs 1 lakh, we are left with Rs 50,000. 10% tax of this is to be calculated. 10% of Rs 50,000 is Rs 5000.

How much tax can be saved by ELSS?

Rama Karmakar, Tax Partner – People Advisory Services, EY India says, “According to Section 80C of the Income Tax Act, 1961, an individual can claim a deduction of up to Rs 1.5 lakh on the amount paid towards the subscription of any units of mutual funds covered under ELSS.

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How much is tax on ELSS?

Currently, returns on ELSS schemes are taxed at 10% (without indexation benefit) if they exceed Rs. 1,00,000 in any financial year. The reintroduction of LTCG Tax (Long Term Capital Gains Tax) caused a lot of confusion to ELSS investors.

Is ELSS better than PPF?

However, PPF offers much lower returns over a longer time horizon than ELSS. The tax benefits and capital safety are more in favour of PPF; ELSS certainly is an option for better returns. It depends on whether you have the appetite for market volatility or not.

Which is better ELSS or ULIP?

ELSS comparison, features and benefits of both from investment perspective, ELSS makes a better investment scheme in terms of tax benefits. And offer better market exposure to your capital. On the other hand, ULIPs are a good deal if you looking for life insurance cover with some investment benefits.

Can we continue ELSS after 3 years?

The lock-in period of lump-sum investment ends after the end of three years from the investment date. … However, if the investment is made in the SIP of ELSS funds, then the lock-in period shall end after three years of every SIP instalment.

Is ELSS a good investment option?

With investments made in ELSS, one can claim a tax saving under section 80C of the Income Tax Act and get deductions of up to Rs 1.5 lakh in a financial year. … Even though there are risks involved while investing in stocks, stocks have the potential to offer better returns in the long run.

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What is the lock-in period of ELSS?

A 3-year lock-in period is applicable on ELSS – as the schemes qualify for tax deductions u/s 80C, which is lowest among the tax-saving investments.

Which bank is best for ELSS?

Tax Saver (ELSS) Funds

  • Axis Long Term Equity Fund.
  • Nippon India Tax Saver Fund.
  • ICICI Prudential Long Term Equity Fund.
  • Aditya Birla Sun Life Tax Relief 96.
  • Motilal Oswal Long Term Equity Fund.
  • Nippon India Regular Saving Fund.
  • Top 10 ELSS Funds for Saving Tax.

Which is better SIP or lumpsum in ELSS?

Choosing ELSS will help you maximize tax benefits under Section 80C. Lumpsum investments will be better suited if you are investing at the end of a financial year, or if you have a higher risk appetite. On the other hand, SIPs will be better suited if you want to avert risks and have a steady source of income.

How can ELSS save tax?

The investment in ELSS mutual fund schemes can be done either as a lump sum or via monthly systematic investment plans (SIP). By investing Rs 1.5 lakh in a financial year in an ELSS, an individual taxpayer in the highest tax bracket can save tax of Rs 46,800 (inclusive of cess at 4%).

Is ELSS a debt fund?

What is ELSS Mutual Funds? Equity-Linked Saving Scheme (ELSS), commonly referred to as the tax-saving funds, fall under the diversified category of mutual funds. While their maximum exposure is towards equity and equity-oriented securities, a part of the corpus is also invested in debt instruments.

Can I take 2 ELSS funds?

You may consider investing in two or three ELSS funds. However, you may avoid investing in multiple ELSS funds as you could struggle to monitor your investment. … Your investment in ELSS qualifies for a tax deduction under Section 80C only up to a maximum of Rs 1.5 lakh per annum.

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Can I withdraw ELSS before 3 years?

Can ELSS be Withdrawn Within 3 years? The simple answer to this question is No. ELSS investments do not provide the option to withdraw the investment amount before the end of the 3-year lock-in period. In ELSS, investors are given fund units against their invested amount.